World Bank on the Hot Seat for Pushing Dirty Coal
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Friends of the Earth and allied groups protest the Eskom loan outside of the World Bank’s headquarters in Washington, D.C. on April 7, 2010. You can see more pictures from the protest on our Flickr page. |
On April 8, 2010, the World Bank voted to approve a $3.75 billion loan to help South African electricity company Eskom build a massive new coal plant.
This coal plant will be one of the world’s largest and most polluting, spewing millions of tons of global warming pollution into the atmosphere each year and sickening children who grow up in the shadows of its billowing smokestacks. Just as appalling, big multinational corporations, not South Africa’s poor, will overwhelmingly benefit from the project as a result of secret, apartheid-era deals they cut with Eskom.
With South African citizen, union, faith-based and environmental justice groups at the helm — Friends of the Earth and allies across Africa, Europe and the United States put up a strong fight against this loan and succeeded in putting the World Bank on notice for pushing poverty and pollution via its loans.
The United States declined to use its power to prevent the loan from moving forward (and “abstained” from the vote), in contradiction to its own guidance on lending to coal projects and President Obama’s pledge to end subsidies to fossil fuels. However, in a positive step, the Obama administration did release a statement notings its “expectation” that the World Bank will refrain from pushing similar coal projects forward in the future. Four other countries joined the U.S. in abstaining from the vote, a rare number unwilling to green light such a high-stakes project.
Congress has the power to hold the World Bank accountable for its support of dirty coal, as U.S. taxpayers are the single largest source of Bank funding. Friends of the Earth will work with allies to encourage Congress to exercise this power to cut or curtail the Bank’s funding in response to the Eskom vote.
The decision to approve the Eskom loan adds to the World Bank’s already shameful track record of pushing projects that exacerbate climate change and undermine sustainable development. This dirty coal loan outs the Bank once again as part of the problem and should disqualify the Bank as a legitimate manager of international funding for climate solutions in developing countries, over which it is rushing to grab control.
News release urging the U.S. and the World Bank to vote “no” / Friends of the Earth’s Karen Orenstein in The Guardian responding to the decision / More information on the loan and international campaign opposing it / Learn about the World Bank’s track record as a climate polluter